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My opinion on e-currency is evolving the more I see how it's actually working in the real world. Ignoring the fact that bad people many times use e-currency fo

My opinion on e-currency is evolving the more I see how it's actually working in the real world. Ignoring the fact that bad people many times use e-currency for repulsive things like child slavery, the lesson over the past month or two seems very clear: any form of e-currency is a huge tool for governments to monitor and control economic activity. We think of e-currency as being much easier to move around than printed currency, but it's actually much easier to track and control than printed currency. Yes, it begins as an anonymous and cryptographically-secure form of value representation, but once government adds just a little enforcement tweaking (many times without even having to pass a law) it becomes a big lead weight around the owner's neck. Best-case, it's all tracked down to the penny. Worst-case, you lose all your value. I remain a skeptical fan, though. Here's hoping the community works through these issues.

gbrindisi 13y ago
> Ignoring the fact that bad people many times use e-currency for repulsive things like child slavery Source?
- rdl 13y ago
  E-Gold got used for carders (a lot), HYIPs/moneygames, and, most regrettably, child pornography (this is all in court documents; I consulted for E-Gold and worked on an affiliated project back in 1998-1999, about a decade before the prosecution). It was funny running into Carol Van Cleef, a lawyer from Patton Boggs, who defended E-Gold after they were convicted (in implementing the agreement), at the Bitcoin 2013 conference (she knew my name from docs, but we'd never met). E-Gold actually was helping prosecutors vs. the carders/cp people, and maintaining files on them/actively working with law enforcement, but when it became a criminal case about E-Gold, that information was used as evidence the system itself supported these activities. LR is probably in the same position; I know they have essentially the same market positioning.
- the_mitsuhiko 13y ago
  You don't even need a source for this, it should be obvious that it's used for that.
  - shocks 13y ago
    You mean exactly the same way that pound sterling and dollar are used for illegal things too?
    - lmm 13y ago
      I understood that large criminal transactions were generally done in CHF - larger-denomination notes available, and it avoids currency conversion costs when you're withdrawing from one Swiss account and depositing into another.
  - gbrindisi 13y ago
    I know it's used for child pornography, carding and malware related incomes but not for child slavery. From the little I saw on underground forums LR is used for mid to low criminal incomes, by the like of botnet herding profits and carding infos trade. For things bigger and riskier like cashing out massive amounts of stolen cards and bank drops it's my understanding that cybercrooks are using money mule schemes and networks of off shore companies, not LR or similar... I'd flag child slavery as an high risk activity which can't be done just trough LR-like currencies, that's why I was asking for some sources.
rdl 13y ago
This is why I think something blinded is essential; your unlinkability (and thus anonymity) are essentially as strong as cryptography, vs. policy. I'm still trying to figure out if Zerocoin or another decentralized system can work, or if it will require just having a large number of redundant small-but-individually-centralized blinded currencies. You can make each pretty resilient (hidden behind tor or message pools/offline, k of n threshold cryptography, etc.), but if there are 1000 USD currencies, you can hedge and accept the loss of a few and lose only a small percentage of assets.
- DanielBMarkham 13y ago
  Yeah, whatever the solution is, I think it has to be something massively decentralized and blinded. I've been speculating that a distributed double-blind commodities ownership system might fit the bill. Some people buy commodities and hold them, then distribute ownership cryptographically. Owners never know holders, only the definition of what they own. Ownership is transferred cryptographically. Still needs a lot of work, though, even as a blue-sky idea.
  - rdl 13y ago
    Well, that's just "anyone can run a currency"; they don't have to be commodities necessarily; they could be any kind of financial asset. Commodities are maybe easier to trust (I trust you if you say and can easily document possession of 100kg of gold, vs. "promise to repay a loan"), but are neither necessary nor sufficient. Ripple (non-anonymous) and OpenTransactions (potentially anonymous using blinded tokens issued by each participant) kind of take that model. What I'm unclear on is if Zerocoin can be efficient enough, maybe given an optimized, scrypt-based blockchain underlying, to work with either of those as a base, globally decentralized currency. I might like Ripple a lot more if XRP got replaced with Zerocoin. Once Ripple's software is open sourced, it wouldn't be too hard to rip XRP out and replace it with Bitcoin or Zerocoin or anything else.
    - DanielBMarkham 13y ago
      I think you have to go with the early bank model: keep something of value, then issue paper (in our case proof of ownership) against it. The trick here is that both the bank and the owner can be hidden. And there can be a million of each. We live in an information age where this can scale out wonderfully. The thing about commodities is that they "plug into" a pre-existing worldwide commodity market. There are futures markets, places to store them, third-party methods to transport, insurance, and so forth. You can have a standard underlying type of thing to value. Things like promissory notes become much more difficult to value. Not impossible, though. The problem is that in order to understand and predict attacks on the currency, you don't want lots of things with different underlying physical realities. There are two questions here. The first one, as you point out, is risk. The second one is the applicability of international ownership laws. If government X shuts down E-currency #48, everybody gets nothing. But in a decentralized system, if everybody can prove ownership of some tangible item, it might be possible to not lose your shirt. I'd much rather be making a case that these anonymous eight people owe me 10kg of gold -- and demand the government allow me to access it -- than asking for, say, something completely virtual and esoteric like Bitcoin. Asking for my physical property is well-covered by international law. Asking for some cryptographic stuff? You're back into uncharted waters.
yuvadam 13y ago
> bad people many times use e-currency for repulsive things like child slavery Do people not use fiat currency, as well, for repulsive things like child slavery?
- shocks 13y ago
  Hehe, I came here to point this out as well. People are all too quick to jump on the "e-currency is for bad things!" band wagon thinking their precious pounds and dollars are squeaky clean.
- rdl 13y ago
  Physical cash is decentralized and used for a lot of bad stuff. However, it's not digital/online, so there are a lot of ways it's not useful, and it's also easier to investigate in some ways (bulk currency smuggled out of the country can be tracked the same way drugs coming in are tracked.) Bank/etc. operated payment systems, at least the above-board ones, at least pay some level of attention to AML, anti other criminal activity, etc. It's not uniformly effective, sure, but it's hard to operate a large child-porn-for-Visa merchant, and visa/card issuers/gateways tend to cooperate fully with various government agencies in both stopping the activity and in catching/prosecuting the offenders.
- wslh 13y ago
  >> bad people many times use e-currency for repulsive things like child slavery >Do people not use fiat currency, as well, for repulsive things like child slavery? Or do they use computers, and weapons, and, and, and...?
  - rhizome 13y ago
    Just add internet and everything's different!
stuaxo 13y ago
The ZeroCoin extension to bitcoin addresses this, perhaps it should be taken up http://blog.cryptographyengineering.com/2013/04/zerocoin-making-bitcoin-anonymous.html http://blog.cryptographyengineering.com/2013/04/zerocoin-mak...
- gizmo686 13y ago
  As it stands now, zerocoin is infeasible for practical use. A single proof averages 40kb, and takes about to two seconds to verify. Still, it was the first attempt at such a ptotocal, so hopefully we will see improvement.
  - Dylan16807 13y ago
    The bitcoin network does less than one transaction a second total, and that size isn't terribly large compared to normal transactions. It's at least viable to implement in its current form.
dedward 13y ago
Online transaction providers, like Liberty Reserve, Paypal, credit card processors, your bank's website, and so on, are really not digital currencies at all... they are transaction processors. Bitcoin, and things resembling it are actual cryptocurrencies and something we could truly call an e-currency. It's about as trackable as cash (in that it can be tracked but it takes very significant effort, and it can be traded like cash.. it's much more than a number in some database.)
- andyakb 13y ago
  Cash doesn't have a public record of (nearly) all transaction
rdl 13y ago
The ultimate lulz issue for fully anonymous and resilient payments is probably the Jim Bell/Tim May "Assassination Politics" model: http://en.wikipedia.org/wiki/Assassination_market http://en.wikipedia.org/wiki/Assassination_market http://www.outpost-of-freedom.com/jimbellap.htm http://www.outpost-of-freedom.com/jimbellap.htm http://www.cypherpunks.to/faq/cyphernomicron/cyphernomicon.txt http://www.cypherpunks.to/faq/cyphernomicron/cyphernomicon.t... Essentially I could say "I bet $100k that Marcus Badperson will die on the morning of 15 June 2013"; best way to collect is to do the deed yourself (or subcontract.) The terrifying thing is not so much that someone might be willing to pay $100k to kill someone, but that 1mm people might each be willing to pay $0.10. Not so much kickstarter as kickender. (this whole thing was my first contact with the federal court system, since I hosted a mailing list archive for the cypherpunks list on which a lot of this was discussed, when Jim Bell got prosecuted back in 1997 for attacking an IRS office. I was so glad I was running a really mediocre mailing list archive where anyone who sent mail directly to the list address on the machine could inject messages, and by picking the right message id, overwrite...and for getting the world's most awesome attorney on retainer...)
- aptwebapps 13y ago
  A child could have hacked my system, your honor, a child!
- get-dangerous 13y ago
  Is there a turn-key Free software package to run such a market with BitCoin and Tor, and if not, why?
- deleted 13y ago
  [deleted]
- asdkl234890 13y ago
  I bet $100k that Marcus Badperson will die on the morning of 15 June 2013"; best way to collect is to do the deed yourself (or subcontract.) But don't you need someone else to take the other side of the bet? You can't just bet X and get more. You can only get what Y bets in opposition. Assuming no one else agrees with you and makes the same bet, because then you'd have to share what Y put down. And who's going to be the opposing side in these bets? I happen to know Marcus Badperson is a janitor for the federal serve and will spend all day on June 15th cleaning the gold bars inside the safest safe in the world. So I bet a billion dollars he does NOT die between the hours of 9am and 5pm on June 15th. Unless someone else bets more than a billion, the best I can do is simply collect the same billion I put down. I was hoping to find an elaboration of who could be the counter party in the Wikipedia page, but nope nothing there. I think the assassination market is very probable if you completely skip the question of who's the counter party. Or if you have no idea how betting and payouts work in the first place. Otherwise this "assassination market" is total bullshit.
belorn 13y ago
When discussing e-currencies, I find myself asking what the incentives are in using them. What I find is that the biggest reason to use e-currencies is not any intrinsic benefit of the e-currencies itself. Rather, it's the current banking system that has drawbacks which pushes myself and, I assume, others, to look for alternatives. For example, thanks to the move of digital cash over physical, banks has gone from being a care taker to a service provider. That might not sound as a big change, but it has a huge impact on the power balance of the bank vs the consumer. I personally am no longer in control my own money. If I wanted today to take out my own money from the bank here in Sweden, I would have to go down there and ask for permission. If I then give them a reasonable argument why I should be allowed to take out my cash from the bank, then they might allow me to come back in a few weeks and take out the cash. If they do not like my argument for taking out the cash, then they are perfectly legally allowed to deny me access to my money. And that's only about access to my own money. We also have the personal information derived from transactions I make. That data is not even remotely under my control, as it is given out to be data mined by anyone within EU or who has a EU treaty for data sharing (like US). It can also be sold, or data mined by the bank itself, and the bank could claim copyright ownership on it. Therefore, a major benefit of e-currency is that it removes the negative aspects of the current system. It doesn't really need to be anonymous or a cryptographically-secure form of value representation. It just need to be digital and in control of the individual who "owns" the cash. Those priorities might not sound as attractive for criminals, but for me it sound as the way e-currency will grow.
- notahacker 13y ago
  Unless there's some esoteric Swedish law that gives banks special privileges that I'm missing, the bank doesn't have any right to refuse you your money except according to published limits on the timing of withdrawals (and its obligation to freeze accounts under criminal investigation). These limits always can and have existed, and in fact were much worse when the bank genuinely was worried about having to redeem everyone's assets in physically limited gold or currency, instead of being able to pay your money into another account electronically and balance their reserve shortfall with electronic interbank lending and automatically approved loans from the central bank. They've got a lot less motivation to deny access to your funds and little chance of getting away with it, unlike an anonymous overseas intermediary in the trade of some digital asset which is intangible unregulated and not legally recognised as having any monetary value.
0x0 13y ago
To transfer bitcoin anonymously and without adding to the immutable & public blockchain history, couldn't one just exchange the wallet for an account containing exact amount of BTC, "out of bounds" (via email, pgp, whatever), instead of performing a BTC transaction on the network?
- rdl 13y ago
  You have to then fully trust your counterparty to not have retained a copy of the key to do his own BTC transaction on the network, later, forever. You could probably use trusted computing/smartcards with a wallet inside them to do some kind of awesome self-attesting "no one has seen my key yet" physical payment token. Sort of like those Casascius coins, but without the need to trust the maker so much.
- epscylonb 13y ago
  Define "anonymously". Hypothetically someone steals a lot of money from somebody else, if the amount is large enough the victim may be willing to do a lot of detective work in order to trace the funds. This detective work might include... * Blockchain analysis * Offering money to bitcoin mixers in return for information * Traditional private investigation Cash has the same problem, bills can be tracked if the parties involved are motivated enough. Cash does go a long way to providing privacy though, for example in days gone by a husband might have bought a pornographic magazine with cash and the wife would be unaware. This will annoy the libertarian crowd, but a truly anonymous and untraceable medium of exchange is not only most likely impossible, but also undesirable. The failed war on drugs aside, a lot of the things people want to do completely anonymously are illegal for good reasons (CP, human trafficking, etc). It remains to be seen if bitcoin can offer the same kind of privacy that cash does, if bitcoin adoption continues I expect blockchain analysis to become very sophisticated.
  - mindcrime 13y ago
    This will annoy the libertarian crowd, but a truly anonymous and untraceable medium of exchange is not only most likely impossible, but also undesirable. The failed war on drugs aside, a lot of the things people want to do completely anonymously are illegal for good reasons (CP, human trafficking, etc). Does child pornography make cameras "undesirable"? How about USB external hard drives? Or the Internet? Does human trafficking make chains and locks "undesirable"? White cargo vans with blacked-out windows? Freeways? Seriously, let's focus on attacking the unjust behavior itself, not blaming tools and implements that have no inherent intent or character, for good or for evil.
brownbat 13y ago
I'm increasingly worried that the features of crypto-currencies sought by cypherpunks (like me) are basically identical to the features ideal for money laundering. Maybe we need to ask something fundamental (which might sound absurd): "Should money laundering be considered illegal, or a natural human right?" As loaded as that sounds, I don't think it's that easy. There's a pretty clear prima facie case to be made on each side. An avid fan of Satoshi could reasonably abandon unregulated currencies in fear of the social ills they enable (a la the argument from the author of "The End of Money" that we stop printing 50s and 100s, since they are disproportionately used in support of crime, while the rest of us use plastic for large transactions [1]). On the other hand, I could see someone concluding that the world would be better off on net if we don't worry as much about crime, but simply ensure there's a simple way to quickly and anonymously transfer value across long distances. It would be a serious blow to police (and the Woodward/Bernstein's out there) to lose the ability to "follow the money." But there are also compelling economic arguments that lubricating capital flows makes everything better [2, 3]. I remain a skeptical fan too, but the mounting cognitive dissonance is not for the faint of heart. 1. http://www.slate.com/articles/business/cashless_society/2012/02/david_wolman_s_the_end_of_money_reviewed_.html http://www.slate.com/articles/business/cashless_society/2012... 2. Ferguson's Ascent of Money, http://en.wikipedia.org/wiki/The_Ascent_of_Money http://en.wikipedia.org/wiki/The_Ascent_of_Money 3. Maybe various stock European Community arguments pro-liberalization of capital flows, though some of them look weak right now, and it's odd to use these to argue for a new currency...
- DanielBMarkham 13y ago
  "Money laundering" is a very recent crime. Didn't have it 40 years ago. Back then people just moved money around as they wanted. I don't know about others, but I find it very difficult to get upset about a crime that's new, that doesn't impact me, and that the world got along just fine with for centuries. (Of course that doesn't mean that I support crime in general. I'm just taking a side: the social benefit to money-laundering laws is not as much as the social downside, at least in 2013. In 1995 I might have easily weighed it the other way) You have to ask yourself a serious question: are these laws being used to protect us from crime? Or are they being used to protect the financial system itself from us?
Eliezer 13y ago
> Ignoring the fact that bad people many times use e-currency for repulsive things like child slavery [citation needed]
SCdF 13y ago
> Yes, it begins as an anonymous That's the thing though right, it's actually never anonymous? There is a good chance I'm misunderstanding this, but Bitcoin at the very least is pseudononymous, and all that really means is that it's not tied to your legal name-- it's not anominity. What's worse is that (again, maybe I'm misunderstanding) every transaction you make is essentially public knowledge, by virtue of this knowledge having to exist somewhere, and Bitcoin being intentionally designed without a central secret holder. That makes Bitcoin to me a secondary currency: a tool to make once-off transactions that are obscured e.g, you want to support Wikileaks but all the banks aren't letting you, use some tool to NZD->BitC (presumably into a new wallet so as to be untrackable) and then give those BitC to Wikileaks. Which is why I'm confused when people ask regular services whether or not they'll support Bitcoin. Why would anyone buy the Humble Bundle using Bitcoins? What possible advantage does that give them? Like parent I'm a skeptical fan, mostly because I think it's technically cool, and almost certainly useful in less stable regions of the world (in the same way Twitter was arguably very helpful), but I still can't see why I would ever want to use it (except in the once-off style example above).
duphenix 13y ago
The thing with every unit of a currency being trackable is it attacks the root of modern banking. There is no excuse for fractional reserve banking if the fungibility excuse is nullified by the ability to track every unit.

gbrindisi 13y ago

> Ignoring the fact that bad people many times use e-currency for repulsive things like child slavery Source?

rdl 13y ago
E-Gold got used for carders (a lot), HYIPs/moneygames, and, most regrettably, child pornography (this is all in court documents; I consulted for E-Gold and worked on an affiliated project back in 1998-1999, about a decade before the prosecution). It was funny running into Carol Van Cleef, a lawyer from Patton Boggs, who defended E-Gold after they were convicted (in implementing the agreement), at the Bitcoin 2013 conference (she knew my name from docs, but we'd never met). E-Gold actually was helping prosecutors vs. the carders/cp people, and maintaining files on them/actively working with law enforcement, but when it became a criminal case about E-Gold, that information was used as evidence the system itself supported these activities. LR is probably in the same position; I know they have essentially the same market positioning.
the_mitsuhiko 13y ago
You don't even need a source for this, it should be obvious that it's used for that.
- shocks 13y ago
  You mean exactly the same way that pound sterling and dollar are used for illegal things too?
  - lmm 13y ago
    I understood that large criminal transactions were generally done in CHF - larger-denomination notes available, and it avoids currency conversion costs when you're withdrawing from one Swiss account and depositing into another.
- gbrindisi 13y ago
  I know it's used for child pornography, carding and malware related incomes but not for child slavery. From the little I saw on underground forums LR is used for mid to low criminal incomes, by the like of botnet herding profits and carding infos trade. For things bigger and riskier like cashing out massive amounts of stolen cards and bank drops it's my understanding that cybercrooks are using money mule schemes and networks of off shore companies, not LR or similar... I'd flag child slavery as an high risk activity which can't be done just trough LR-like currencies, that's why I was asking for some sources.

rdl 13y ago

This is why I think something blinded is essential; your unlinkability (and thus anonymity) are essentially as strong as cryptography, vs. policy. I'm still trying to figure out if Zerocoin or another decentralized system can work, or if it will require just having a large number of redundant small-but-individually-centralized blinded currencies. You can make each pretty resilient (hidden behind tor or message pools/offline, k of n threshold cryptography, etc.), but if there are 1000 USD currencies, you can hedge and accept the loss of a few and lose only a small percentage of assets.

DanielBMarkham 13y ago
Yeah, whatever the solution is, I think it has to be something massively decentralized and blinded. I've been speculating that a distributed double-blind commodities ownership system might fit the bill. Some people buy commodities and hold them, then distribute ownership cryptographically. Owners never know holders, only the definition of what they own. Ownership is transferred cryptographically. Still needs a lot of work, though, even as a blue-sky idea.
- rdl 13y ago
  Well, that's just "anyone can run a currency"; they don't have to be commodities necessarily; they could be any kind of financial asset. Commodities are maybe easier to trust (I trust you if you say and can easily document possession of 100kg of gold, vs. "promise to repay a loan"), but are neither necessary nor sufficient. Ripple (non-anonymous) and OpenTransactions (potentially anonymous using blinded tokens issued by each participant) kind of take that model. What I'm unclear on is if Zerocoin can be efficient enough, maybe given an optimized, scrypt-based blockchain underlying, to work with either of those as a base, globally decentralized currency. I might like Ripple a lot more if XRP got replaced with Zerocoin. Once Ripple's software is open sourced, it wouldn't be too hard to rip XRP out and replace it with Bitcoin or Zerocoin or anything else.
  - DanielBMarkham 13y ago
    I think you have to go with the early bank model: keep something of value, then issue paper (in our case proof of ownership) against it. The trick here is that both the bank and the owner can be hidden. And there can be a million of each. We live in an information age where this can scale out wonderfully. The thing about commodities is that they "plug into" a pre-existing worldwide commodity market. There are futures markets, places to store them, third-party methods to transport, insurance, and so forth. You can have a standard underlying type of thing to value. Things like promissory notes become much more difficult to value. Not impossible, though. The problem is that in order to understand and predict attacks on the currency, you don't want lots of things with different underlying physical realities. There are two questions here. The first one, as you point out, is risk. The second one is the applicability of international ownership laws. If government X shuts down E-currency #48, everybody gets nothing. But in a decentralized system, if everybody can prove ownership of some tangible item, it might be possible to not lose your shirt. I'd much rather be making a case that these anonymous eight people owe me 10kg of gold -- and demand the government allow me to access it -- than asking for, say, something completely virtual and esoteric like Bitcoin. Asking for my physical property is well-covered by international law. Asking for some cryptographic stuff? You're back into uncharted waters.

yuvadam 13y ago

> bad people many times use e-currency for repulsive things like child slavery Do people not use fiat currency, as well, for repulsive things like child slavery?

shocks 13y ago
Hehe, I came here to point this out as well. People are all too quick to jump on the "e-currency is for bad things!" band wagon thinking their precious pounds and dollars are squeaky clean.
rdl 13y ago
Physical cash is decentralized and used for a lot of bad stuff. However, it's not digital/online, so there are a lot of ways it's not useful, and it's also easier to investigate in some ways (bulk currency smuggled out of the country can be tracked the same way drugs coming in are tracked.) Bank/etc. operated payment systems, at least the above-board ones, at least pay some level of attention to AML, anti other criminal activity, etc. It's not uniformly effective, sure, but it's hard to operate a large child-porn-for-Visa merchant, and visa/card issuers/gateways tend to cooperate fully with various government agencies in both stopping the activity and in catching/prosecuting the offenders.
wslh 13y ago
>> bad people many times use e-currency for repulsive things like child slavery >Do people not use fiat currency, as well, for repulsive things like child slavery? Or do they use computers, and weapons, and, and, and...?
- rhizome 13y ago
  Just add internet and everything's different!

stuaxo 13y ago

The ZeroCoin extension to bitcoin addresses this, perhaps it should be taken up http://blog.cryptographyengineering.com/2013/04/zerocoin-making-bitcoin-anonymous.html http://blog.cryptographyengineering.com/2013/04/zerocoin-mak...

gizmo686 13y ago
As it stands now, zerocoin is infeasible for practical use. A single proof averages 40kb, and takes about to two seconds to verify. Still, it was the first attempt at such a ptotocal, so hopefully we will see improvement.
- Dylan16807 13y ago
  The bitcoin network does less than one transaction a second total, and that size isn't terribly large compared to normal transactions. It's at least viable to implement in its current form.

dedward 13y ago

Online transaction providers, like Liberty Reserve, Paypal, credit card processors, your bank's website, and so on, are really not digital currencies at all... they are transaction processors. Bitcoin, and things resembling it are actual cryptocurrencies and something we could truly call an e-currency. It's about as trackable as cash (in that it can be tracked but it takes very significant effort, and it can be traded like cash.. it's much more than a number in some database.)

andyakb 13y ago
Cash doesn't have a public record of (nearly) all transaction

rdl 13y ago

The ultimate lulz issue for fully anonymous and resilient payments is probably the Jim Bell/Tim May "Assassination Politics" model: http://en.wikipedia.org/wiki/Assassination_market http://en.wikipedia.org/wiki/Assassination_market http://www.outpost-of-freedom.com/jimbellap.htm http://www.outpost-of-freedom.com/jimbellap.htm http://www.cypherpunks.to/faq/cyphernomicron/cyphernomicon.txt http://www.cypherpunks.to/faq/cyphernomicron/cyphernomicon.t... Essentially I could say "I bet $100k that Marcus Badperson will die on the morning of 15 June 2013"; best way to collect is to do the deed yourself (or subcontract.) The terrifying thing is not so much that someone might be willing to pay $100k to kill someone, but that 1mm people might each be willing to pay $0.10. Not so much kickstarter as kickender. (this whole thing was my first contact with the federal court system, since I hosted a mailing list archive for the cypherpunks list on which a lot of this was discussed, when Jim Bell got prosecuted back in 1997 for attacking an IRS office. I was so glad I was running a really mediocre mailing list archive where anyone who sent mail directly to the list address on the machine could inject messages, and by picking the right message id, overwrite...and for getting the world's most awesome attorney on retainer...)

aptwebapps 13y ago
A child could have hacked my system, your honor, a child!
get-dangerous 13y ago
Is there a turn-key Free software package to run such a market with BitCoin and Tor, and if not, why?
deleted 13y ago
[deleted]
asdkl234890 13y ago
I bet $100k that Marcus Badperson will die on the morning of 15 June 2013"; best way to collect is to do the deed yourself (or subcontract.) But don't you need someone else to take the other side of the bet? You can't just bet X and get more. You can only get what Y bets in opposition. Assuming no one else agrees with you and makes the same bet, because then you'd have to share what Y put down. And who's going to be the opposing side in these bets? I happen to know Marcus Badperson is a janitor for the federal serve and will spend all day on June 15th cleaning the gold bars inside the safest safe in the world. So I bet a billion dollars he does NOT die between the hours of 9am and 5pm on June 15th. Unless someone else bets more than a billion, the best I can do is simply collect the same billion I put down. I was hoping to find an elaboration of who could be the counter party in the Wikipedia page, but nope nothing there. I think the assassination market is very probable if you completely skip the question of who's the counter party. Or if you have no idea how betting and payouts work in the first place. Otherwise this "assassination market" is total bullshit.

belorn 13y ago

When discussing e-currencies, I find myself asking what the incentives are in using them. What I find is that the biggest reason to use e-currencies is not any intrinsic benefit of the e-currencies itself. Rather, it's the current banking system that has drawbacks which pushes myself and, I assume, others, to look for alternatives. For example, thanks to the move of digital cash over physical, banks has gone from being a care taker to a service provider. That might not sound as a big change, but it has a huge impact on the power balance of the bank vs the consumer. I personally am no longer in control my own money. If I wanted today to take out my own money from the bank here in Sweden, I would have to go down there and ask for permission. If I then give them a reasonable argument why I should be allowed to take out my cash from the bank, then they might allow me to come back in a few weeks and take out the cash. If they do not like my argument for taking out the cash, then they are perfectly legally allowed to deny me access to my money. And that's only about access to my own money. We also have the personal information derived from transactions I make. That data is not even remotely under my control, as it is given out to be data mined by anyone within EU or who has a EU treaty for data sharing (like US). It can also be sold, or data mined by the bank itself, and the bank could claim copyright ownership on it. Therefore, a major benefit of e-currency is that it removes the negative aspects of the current system. It doesn't really need to be anonymous or a cryptographically-secure form of value representation. It just need to be digital and in control of the individual who "owns" the cash. Those priorities might not sound as attractive for criminals, but for me it sound as the way e-currency will grow.

notahacker 13y ago
Unless there's some esoteric Swedish law that gives banks special privileges that I'm missing, the bank doesn't have any right to refuse you your money except according to published limits on the timing of withdrawals (and its obligation to freeze accounts under criminal investigation). These limits always can and have existed, and in fact were much worse when the bank genuinely was worried about having to redeem everyone's assets in physically limited gold or currency, instead of being able to pay your money into another account electronically and balance their reserve shortfall with electronic interbank lending and automatically approved loans from the central bank. They've got a lot less motivation to deny access to your funds and little chance of getting away with it, unlike an anonymous overseas intermediary in the trade of some digital asset which is intangible unregulated and not legally recognised as having any monetary value.

0x0 13y ago

To transfer bitcoin anonymously and without adding to the immutable & public blockchain history, couldn't one just exchange the wallet for an account containing exact amount of BTC, "out of bounds" (via email, pgp, whatever), instead of performing a BTC transaction on the network?

rdl 13y ago
You have to then fully trust your counterparty to not have retained a copy of the key to do his own BTC transaction on the network, later, forever. You could probably use trusted computing/smartcards with a wallet inside them to do some kind of awesome self-attesting "no one has seen my key yet" physical payment token. Sort of like those Casascius coins, but without the need to trust the maker so much.
epscylonb 13y ago
Define "anonymously". Hypothetically someone steals a lot of money from somebody else, if the amount is large enough the victim may be willing to do a lot of detective work in order to trace the funds. This detective work might include... * Blockchain analysis * Offering money to bitcoin mixers in return for information * Traditional private investigation Cash has the same problem, bills can be tracked if the parties involved are motivated enough. Cash does go a long way to providing privacy though, for example in days gone by a husband might have bought a pornographic magazine with cash and the wife would be unaware. This will annoy the libertarian crowd, but a truly anonymous and untraceable medium of exchange is not only most likely impossible, but also undesirable. The failed war on drugs aside, a lot of the things people want to do completely anonymously are illegal for good reasons (CP, human trafficking, etc). It remains to be seen if bitcoin can offer the same kind of privacy that cash does, if bitcoin adoption continues I expect blockchain analysis to become very sophisticated.
- mindcrime 13y ago
  This will annoy the libertarian crowd, but a truly anonymous and untraceable medium of exchange is not only most likely impossible, but also undesirable. The failed war on drugs aside, a lot of the things people want to do completely anonymously are illegal for good reasons (CP, human trafficking, etc). Does child pornography make cameras "undesirable"? How about USB external hard drives? Or the Internet? Does human trafficking make chains and locks "undesirable"? White cargo vans with blacked-out windows? Freeways? Seriously, let's focus on attacking the unjust behavior itself, not blaming tools and implements that have no inherent intent or character, for good or for evil.

brownbat 13y ago

I'm increasingly worried that the features of crypto-currencies sought by cypherpunks (like me) are basically identical to the features ideal for money laundering. Maybe we need to ask something fundamental (which might sound absurd): "Should money laundering be considered illegal, or a natural human right?" As loaded as that sounds, I don't think it's that easy. There's a pretty clear prima facie case to be made on each side. An avid fan of Satoshi could reasonably abandon unregulated currencies in fear of the social ills they enable (a la the argument from the author of "The End of Money" that we stop printing 50s and 100s, since they are disproportionately used in support of crime, while the rest of us use plastic for large transactions [1]). On the other hand, I could see someone concluding that the world would be better off on net if we don't worry as much about crime, but simply ensure there's a simple way to quickly and anonymously transfer value across long distances. It would be a serious blow to police (and the Woodward/Bernstein's out there) to lose the ability to "follow the money." But there are also compelling economic arguments that lubricating capital flows makes everything better [2, 3]. I remain a skeptical fan too, but the mounting cognitive dissonance is not for the faint of heart. 1. http://www.slate.com/articles/business/cashless_society/2012/02/david_wolman_s_the_end_of_money_reviewed_.html http://www.slate.com/articles/business/cashless_society/2012... 2. Ferguson's Ascent of Money, http://en.wikipedia.org/wiki/The_Ascent_of_Money http://en.wikipedia.org/wiki/The_Ascent_of_Money 3. Maybe various stock European Community arguments pro-liberalization of capital flows, though some of them look weak right now, and it's odd to use these to argue for a new currency...

DanielBMarkham 13y ago
"Money laundering" is a very recent crime. Didn't have it 40 years ago. Back then people just moved money around as they wanted. I don't know about others, but I find it very difficult to get upset about a crime that's new, that doesn't impact me, and that the world got along just fine with for centuries. (Of course that doesn't mean that I support crime in general. I'm just taking a side: the social benefit to money-laundering laws is not as much as the social downside, at least in 2013. In 1995 I might have easily weighed it the other way) You have to ask yourself a serious question: are these laws being used to protect us from crime? Or are they being used to protect the financial system itself from us?

Eliezer 13y ago

> Ignoring the fact that bad people many times use e-currency for repulsive things like child slavery [citation needed]

SCdF 13y ago

> Yes, it begins as an anonymous That's the thing though right, it's actually never anonymous? There is a good chance I'm misunderstanding this, but Bitcoin at the very least is pseudononymous, and all that really means is that it's not tied to your legal name-- it's not anominity. What's worse is that (again, maybe I'm misunderstanding) every transaction you make is essentially public knowledge, by virtue of this knowledge having to exist somewhere, and Bitcoin being intentionally designed without a central secret holder. That makes Bitcoin to me a secondary currency: a tool to make once-off transactions that are obscured e.g, you want to support Wikileaks but all the banks aren't letting you, use some tool to NZD->BitC (presumably into a new wallet so as to be untrackable) and then give those BitC to Wikileaks. Which is why I'm confused when people ask regular services whether or not they'll support Bitcoin. Why would anyone buy the Humble Bundle using Bitcoins? What possible advantage does that give them? Like parent I'm a skeptical fan, mostly because I think it's technically cool, and almost certainly useful in less stable regions of the world (in the same way Twitter was arguably very helpful), but I still can't see why I would ever want to use it (except in the once-off style example above).

duphenix 13y ago

The thing with every unit of a currency being trackable is it attacks the root of modern banking. There is no excuse for fractional reserve banking if the fungibility excuse is nullified by the ability to track every unit.